Green shoots in Bermuda’s economic recovery
The Ministry of Finance estimated that Bermuda’s gross domestic product grew from 4.5 per cent to 5 per cent in 2024, driven by expansion in the international business sector and a continued recovery in tourism.
The estimate is contained in the “2024 National Economic Report of Bermuda”, a document annually released in conjunction with the Government Budget.
The most recent GDP estimates published by the Department of Statistics have 2023 up 9 per cent, the third consecutive year of post-pandemic growth.
The report said: “International business figures, tourist arrivals and air visitor spending, income levels, retail sales, and employment all saw improvements compared to 2023.”
Last year, 766 new international companies and partnerships were registered in Bermuda, bringing the total number of registered businesses to 12,396, reflecting growth of 0.4 per cent year-over-year.
The sector’s employment income for 2024 also recorded a growth of $195.90 million or 12.3 per cent.
Preliminary 2024 Employment Survey data had an overall increase of 471 jobs (1.4 per cent) to 33,337, the third consecutive year of growth.
Job growth was driven by IB (120 new jobs or 2.4 per cent), the administrative and support services (96 new jobs or 5.4 per cent), and accommodation and food service activities (81 jobs or 2.2 per cent).
Since 2020, IB has remained Bermuda’s largest employer, growing at an average annual rate of 2.4 per cent.
As of 2024, employment in the sector stood at 5,047, marking its highest recorded level, surpassing the pre-financial crisis peak of 2008.
Bermudians (53.7 per cent) and non-Bermudian spouses of Bermudians (5.6 per cent) accounted for 59.3 per cent of the island’s leading employer.
The sustained tourism activity contributed to a third consecutive year of job growth in the accommodation and food service sector, which grew to 3,780 by the close of 2024, equating to approximately 80.6 per cent of 2019 employment levels.
The report notes that when adjusted for inflation, the 2023 level of economic activity, or real GDP, grew by 4.9 per cent. That was higher than the five-year average (2019-2023) of 1.9 per cent.
Continuing growth was expected, as the island emerged from the pandemic slowdown, largely driven by IB activities and financial and insurance activities.
It was offset by a marginal decrease across nine sectors with construction and quarrying, professional, scientific and technical activities, and human health and social work accounting for 77 per cent of the decline.
The report said: “This [IB] sector provided $2.03 billion in total output, a 6.1 per cent increase compared to 2022, and accounted for an estimated 29 per cent of total GDP.
“Within the sector, businesses engaged in insurance management, insurance brokerage services, and reinsurance experienced the largest increases in value added.
“By contrast, business related to communication services activities, business services, and portfolio advisory services experienced declines in value added.“
Real estate activities were the second-largest contributor to real GDP, accounting for $1.04 billion in output, or 14.9 per cent of total GDP. The sector grew by 0.6 per cent, or $5.8 million.
The financial and insurance activities sector was the next largest contributor to Bermuda’s economy.
Personal consumption for 2024 was up 2.9 per cent, including housing, water, electricity, gas and other fuels.
IB’s outsize role in the growth of island-wide employment income also supported an uptick in retail sales.
For 2024, the value of new construction projects fell from $201.4 million in 2023 to $164.7 million, a decrease of 18.2 per cent. The total estimated value of work put in place during the same period also fell slightly, predominantly driven by a fall in work put in place in the hotels and guesthouses which showed an 85 per cent decline.
Residential work accounted for 45.7 per cent of total construction activity. Office, shops, and warehouses contributed 21.7 per cent, while industrial, plant, and other work made up 15.6 per cent of total activity.
Combined, these three categories represented 83 per cent of all construction work during this period, 53.7 per cent of which was conducted by the private sector.
It meant 113 new 2024 dwelling units, 38 more than in 2023.
International business (up 9.4 per cent) and tourism (up 3.3 per cent) were Bermuda’s 2024 primary sources of foreign exchange earnings – 67.8 per cent of the total balance of payments current account receipts (excluding financial services).
Air arrivals increased by 9.6 per cent compared to 2023, reaching 203,080, down 24.6 per cent compared to 2019, although spending increased by 22.0 per cent.
Total leisure air visitors rose by 15.2 per cent compared to 2023, totalling 139,546. This was down 27.1 per cent compared to 2019. Cruise arrivals expanded by 1.9 per cent compared to 2023, reaching 535,356.
• For more on the 2024 National Economic Report of Bermuda, see Related Media
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